Greg Lindberg ponders appeal as policyholders await June funds release

Image shows Greg Lindberg against a court background scene. — If Greg Lindberg forgoes an appeal, Bankers Life policyholders could get their money as early as this summer.

By John Hilton

Embattled entrepreneur Greg Lindberg is weighing options after a North Carolina Court of Appeals decision this week clears the way for his former insurance companies to be liquidated.

His adversary, Insurance Commissioner Mike Causey, said long-suffering policyholders could be paid back as early as this summer if Lindberg accepts the ruling.

"We are evaluating all of our options," Lindberg said in a statement to InsuranceNewsNet. "We have had multiple offers to purchase these companies for hundreds of millions of dollars. All the NCDOI has to do is approve one of these offers and the companies can be sold and policyholders can access their full policy benefits.”

Lindberg put forth various plans in the years since his four former insurance companies entered receivership. A December 2022 news release said that Universal Financial Holdings agreed to purchase stock in all four insurers, allowing them to exit rehabilitation. The sale supposedly would have provided more than $337 million in capital and surplus, Lindberg has said.

Causey's office did not entertain those plans, proceeding with full liquidation via the courts.

In a unanimous decision, a three-judge appellate panel issued an opinion Tuesday against GBIG Holdings, which had sought to delay liquidation of Bankers Life Insurance Co. and Colorado Bankers Life Insurance Co. The judges reversed a lower-court ruling granting intervenor status to GBIG.

"GBIG should not have been allowed to intervene and defend against the liquidation petition, as only a company’s directors are permitted to intervene to defend under [North Carolina law]," the ruling states.

Liquidation to be finalized

The ruling clears the way for liquidation proceedings to continue against the two Bankers Life insurers.

"As it stands now, the Order of Liquidation will become effective on June 30, 2024, and the guaranty associations could start making payments to policyholders if there are no further appeals," reads a Thursday notice from the rehab administrator. "However, Mr. Lindberg’s company may seek to appeal the Court of Appeals’ March 5 decision to the North Carolina Supreme Court, causing further delays."

Lindberg faces a host of civil and criminal charges for alleged fraud and bribery connected to the downfall of his billion-dollar business empire. He is due back in federal court on May 6 for a retrial for allegedly attempting to bribe Causey to secure preferential regulatory treatment for his insurance businesses.

Lindberg was convicted and served two years in prison before the verdict was overturned. The 4th Circuit panel declared that Judge Max Cogburn had erred by giving jurors in Lindberg’s trial misleading instructions before they began deliberations.

Lindberg, founder of the private equity firm Eli Global, eventually acquired several insurers and grouped them together as the Global Bankers Insurance Group. Regulators say Lindberg used the insurers to funnel money to his other businesses.

When Causey filed for liquidation proceedings in November 2022, Bankers Life had assets of $253 million and liabilities of $345 million, while Colorado Bankers Life had assets of $1.37 billion and liabilities of $2.5 billion, court documents say.

Bankers Life agents and policyholders have been fighting for their funds for several years now. Causey, in the midst of a tough election fight of his own, expressed optimism that money will flow to policyholders later this year.

Many state life and health insurance guaranty associations provide coverage up to $300,000 for life insurance death benefits, $100,000 for life insurance policy net cash values and $250,000 in the present value of annuity benefits, Causey's office said. Some state life and health insurance guaranty associations are authorized to provide different levels of protection.

InsuranceNewsNet Senior Editor John Hilton covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.

InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.